As we all know, the major stock indexes have been under heavy institutional distribution for several months now. While all of the U.S. Dollar sensitive sectors have been hit very hard the agriculture stocks have lead the declines with copper. The Market Vectors Agribusiness ETF (NYSE:MOO) has decline sharply from it’s July 2011 high of $56.00. Yesterday, the MOO traded as low as $39.86 a share before staging a monster bounce into the close. Today, the MOO is trading higher by $1.26 to $43.16 a share. It is safe to say that the agriculture sector is very oversold and due for a bounce. It is important for traders to understand that the agriculture sector is very sensitive to U.S. Dollar Index. If the U.S. Dollar Index rallies higher again the agriculture stocks will likely pullback and decline again. Until that time, traders should enjoy the bounce in the agriculture sector.
Some leading agriculture stocks that are trading higher today include Potash Corp Sask Inc (NYSE:POT), Mosaic Co NYSE:MOS), Monsanto Co (NYSE:MON), and Intrepid Potash Inc (NYSE:IPI). All of these stocks were very oversold and could have a bit more upside in the short term. Traders should watch for near term resistance on the MOO around the $46.00 area.